(Reuters) -U.S. stock index futures fell on Monday, while Treasury yields rose after ratings agency Moody's downgraded the country's sovereign rating by one notch, bringing forward concerns around the ballooning U.S. debt.

The ratings agency late on Friday downgraded the U.S. sovereign credit rating to "Aa1" from "Aaa", due to concerns about the nation's growing, $36 trillion debt pile.

"Moody's have had them on watch since November 2023 and if there is going to be a change then it tends to happen within 12-18 months so this news shouldn't have been unexpected," Deutsche Bank analysts said in a note.

Moody's first gave the United States its pristine "Aaa" rating in 1919, and is the last of the three major credit agencies to downgrade it.

Worries over the ever-increasing U.S. deficit remained front and center as Trump's sweeping tax-cut bill, which had been stalled for days by Republican infighting over spending cuts, won approval from a key congressional committee on Sunday.

At 04:18 a.m. ET, Dow E-minis were down 335 points, or 0.78%, S&P 500 E-minis were down 73.5 points, or 1.23%, Nasdaq 100 E-minis were down 345.75 points, or 1.61%.

Meawhile, yields on U.S. government bonds - which move inverted to prices - ticked higher, with the 10-year note last yielding 4.51%.

Most megacap and growth stocks trended lower in premarket trading, with Tesla leading losses with a 4.4% fall.

Chip stocks also sold off, with Advanced Micro Devices and Nvidia down more than 3% each, and Intel losing close to 2%.

The S&P 500 had registered its fifth straight day of gains on Friday, closing out the week with firm gains as markets took to heart a temporary truce on the trade front between the U.S. and China, along with some tame inflation data.

The quarterly earnings season was in its last leg with more than 90% of S&P 500 companies having already reported.

Dow component Home Depot and retailer Target are some of the companies slated to report earnings later this week.

Focus is also on the Federal Reserve, with at least five officials, including New York Fed President John Williams, slated to make public remarks throughout the day.

(Reporting by Shashwat Chauhan in Bengaluru; Editing by Varun H K)